Use the Information Below to Answer the Following Question(s)

question 16

Multiple Choice

Use the information below to answer the following question(s) .Low-Cost Rentals Ltd.incurred $60,000 of common fixed costs and $90,000 of common variable costs.Data are provided below for the capacity allowed and the capacity used. For both departments, common fixed costs are to be allocated on the basis of capacity available and common variable costs are to be allocated on the basis of capacity used.
-To discourage unnecessary use of a support department, management might

• A)not allocate any support department costs to user departments.
• B)allocate support department costs based upon user department usage.
• C)allocate a fixed amount of support department costs to each department regardless of use.
• D)issue memos on useful services provided by the support department.
• E)allocate only variable costs based on budgeted usage.

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Definitions:

Job Mobility

The ability of workers to change jobs, often relating to career advancement opportunities.

Uncertainty Avoidance

A cultural dimension that describes the extent to which people in a society are uncomfortable with ambiguity and uncertainty.

Ambiguity

The quality of being open to more than one interpretation; lack of definiteness or certainty.

Unpredictability

The quality of being unable to be predicted or foreseen, often leading to uncertainty or instability in various contexts.